Pre market: Futures down decently as they have dropped in the past few minutes. This after a nice reversal to the upside Friday led by the glamour growth names and for a change, the small caps.
The NASDAQ/NDX/SOX all held the 50 day Friday. These are your leading areas. We are actually amazed there has not been more damage here but there have been plenty of times we have seen narrow in the big leaders. To be clear…IF THEY GET THESE AREAS, GET THE FORK!
All the other major indices are in what we call “no man’s land!” All sitting below shorter term resistance but above longer term support between the 50 day and the 200 day. But…leave no doubt, the complexion is much different. Anyone who thinks the market is just going to walk back up thinks the Knicks will win the NBA championship this year. But again, glamour growth like AMZN, NFLX and a decent amount of names are still in strong bull markets.
Smaller FINANCIALS are back above the 50 day (KRE, KBE). The bigger financials not as strong but important names BAC and JPM are now sitting on the all-important 50 day.
EUROPE acts terrible. Many other countries around the globe are under pressure. ASIA is now in trouble. JAPAN has been blasted but don’t worry. BOJ’s Kuroda, the king of easy money says they can ease further if need be. Of course, they still have negative rates and are still printing but that’s not enough.
Interest rate sensitive stuff remains in trouble but oversold. Notice yields have been actually coming down in recent days. This includes real estate, utilities and housing.
Don’t know what the deal is but recession-resistant stuff in their own private bear. Food, drug, beverage, tobacco, household products.
Only about 40% (being kind) remain in good shape right now. Just a few weeks ago, this number was about 75%.
And tariffs. Nothing like being cursed out by the Trumpsters just because you say there is a better way. I actually agree with the president that trade needs to be addressed but painting everyone with the same brush doesn’t work. Do not forget that every country will act in their own self interests, not ours. Yes…we are the most important country around the globe and yes, a lot of countries cheat but again, taxing products will only hurt the economy. Remember, it is the consumer who pays the tariff. Get these country’s negotiators in a room and be the great negotiator you are President Trump and find a happy place.
Lastly, do not believe for a second the recent drubbing was only because of tariffs. The surprise tariff announcement came out almost 2 days after the market topped again….and remember, the market topped way back on January 29.